Last time we said
‘We are currently retracing in a wave b that should take us into the 54400/ 53000 area where we would look to buy with stops below 47100.’ We traded down to 52955 with wave b stopping exactly in our area. Remain long whist above 47100.
A break below last week low will signal wave b is tracing out a zigzag so look to add around the 50200 level. Target for the next leg up are 60500 where wave b will equal 61.8% of wave b, followed by a test of the previous high at 64870 where wave c will equal the same length as wave a. So remain long and add on dips with stops below 47100.
Last time we said
‘I would reduce our long by 50% now at 3475 and look to rebuy and add on the expected retracement. But we believe the upside is the predominant trend continue.’
We traded down to 3172 the 38.2% retracement level (this is often a relationship seen in crypto currency’s) before rallying up in 5 waves before yesterdays sharp sell off. Given the divergence in the MACD we are turning bearish on Ethereum having completed 5 wave while we trade below yesterdays high. We usually target the are of the previous wave (iv) so we expect to see at least a test of the green trendline below 3000.
Here I have copied a chart from Elliot wave international which I am unable to replicate so am using theirs. This shows the possible retracement levels on a logarithmic chart. IF we have seen the high in Etheurm then given the retracement levels and the fact we target the previous wave iv area we should see a sharp sell off in the coming weeks to the 1350/2080 area.
